PBBANK reported a 2QFY16 net profit of RM1,256.2m (+5.0% yoy) with
the annualised net profit largely within our and market expectations.
Its net profit was mainly supported by strong growth in net interest
income (9.3%yoy) which was in turn underpinned by a better net interest
margin (NIM) and higher average loan balance. This was, however,
mitigated by weaker non-interest income (-9.7% yoy) and higher operating
expenses (+11.2% yoy). Cost-to-income ratio (CIR) saw an uptick to
31.1% in the quarter (2QFY15: 31.2%), but remained the lowest in the
industry.

Despite an increase in absolute amount for impairment allowance, credit cost remained largely flat on yoy and qoq basis.

Going Forward:
Despite unexpected good results of PBBANK in FY15, moving forward, I
believe that PBBANK result will be stable or a bit slow down. This is
because loan applications will continue to be slow marginally and NIM
compression will be higher in the future. PBBANK believes that its asset
quality position will remain robust, in line with continued employment
and income growth notwithstanding the rising cost of living and a
moderated economic environment.
PBBANK announced its FY16 KPI targets which were slightly lower than FY15:

ROE>15

RWCR of >13%

GIL ratio < 1%

CI ratio < 33.0%

Group loan growth of 8-9%

Group deposit growth of 7-8%.

In my opinion, fair value of PBBANK is from 19.5 to 20.2 (Uncertainty Risk is HIGH).
I will continue to hold this share, and will not accumulate it for the time being.At the time of writing, I owned shares of PBBANK.